formerly cdixon.posterous.com

starting your first company

Things you should do when you are just starting up:

– make sure you have the right team. if you are doing a consumer web startup, you *need* someone on the team who is native web product person. if you are doing real tech, you need someone who is true native techie.

– hire a good startup law firm (i like gunderson) and get standardized incorporation, vesting etc docs. it's worth it. (but try to only pay $5K or so with promise to pay more later when you get funding etc).

– talk to everyone you can about your idea. collect feedback, criticism, maybe garner some allies along the way (even advisors which can help build your credibility).

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34 thoughts on “starting your first company”

“how googleable are you? if you aren’t winning the first page of google when you type in your name, that means you aren’t doing a good job building your web presence.” Did you mean people, product, or both?

I disagree with the “don’t learn to code”. I suck at it. I really do. I’ll never be good. But banging my head and trying helps me be more empathetic and knowledgable when talking/working with engineers. I understand TDD a lot better now. I get the fat model/skinny controller concept. In my experience, the engineers I’ve worked with appreciate the effort and interest, and I think it’s led to more trust and a better working relationship.

great primer.i’d also recommend taking the time to vet your idea with (a) serious market research, (b) feedback from high level advisory, (c) social feedback from friends / family / trusted network, (d) figuring out simple validation that can be coded quickly (i think the success of YCombinator is indicative that this can be done cheaply and validated by the marketplace of users/investors quickly)team is so super critical – people that can adapt to pivots, hustle hard/make sacrifices & have strong technical skills and execution are a necessary baseline. finding tech co-founders that have started/completed cool projects and/or have worked at startups in the past is huge.smart team, quick iterations and innovative product vision are often a killer combo.

learning to code: i should clarify what i meant. it’s always great to learn new things, including how to code. just don’t expect to learn it and be a primary coder. have sufficient respect for the art/science of coding to know that at best you’ll just be more empathetic & savvy about what the real coders are doing.

Chris, I love your blog and recommend you widely, but disagree here. If, before you’ve even built your product, you read all the blogs, go to all the events, network extensively, post to Twitter and blog regularly, Google your own name periodically, you won’t have time to do anything else. To me, it seems like too many first-time entrepreneurs focus on becoming an Internet celebrity rather than building a product customers want. The world is really very simple for a new company: until you build a product customers want, nothing else matters. And fewer people will listen to you anyway until you have a Chris Dixon-like track record.

Good post, some comments:1) I mostly agree with Glenn, but maybe to a lesser degree. I definitely avoid most tech events like the plague. 2) I think you left off an important item, which is to get a real and active group of advisors to help you run the business. I don’t mean other entrepreneurs, or folks who started their company 2 years before you. I mean really solid business leaders who can help you deal with employees, comp, biz dev negotiations, etc. Having that has helped me avoid lots of first-time mistakes. Also, having advisors is useless if you don’t use them. We’ve definitely terminated advisory agreements when we didn’t feel like we were getting the right amount of support from the advisor.

You forgot:- practice standing in front of a baseball pitching machine a la Happy Gilmore, because if you don’t have thick skin, you better develop some fast.Starting a company is often (always?) a scary, emotional rollercoaster. If there were a liquid, high volume market where shares of my prefunded startup were traded, I shudder to think how volatile the stock would be from day to day at this early stage.On the Googleability front, I unfortunately share the name of a Conde Nast publishing magnate and heir to one of the largest fortunes in the world- can I get a pass on that?

Glenn – I think you can do a lot of this stuff (blogging etc) in just a couple hours a week. maybe I am overcompensating here but I just meet so many startups that are heads down on product and not getting enough feedback, engaging with tech community etc. (maybe it’s a NYC thing?)

Some people over focus on being in and part of the startup community. (Which is important for some advice and recruiting) What’s really important is being part of there community that are your customers.

Agree that you need to talk to others, but maybe there’s a difference between talking to customers and networking? From where I sit, I just see more entrepreneurs who need a better product rather than a bigger network.I’m also really into the idea of flow, a kind of zen-like state where you can really crank on product, and tend to believe that the amount of time you actually have in flow is <50>And then there’s the allure of Twitter or blogging. Once you get your first re-tweet, your first comment, it draws you in… it’s a tractor beam that’s hard to turn off.All that said, I think you’ve really made it work for Hunch. I think about your example all the time and compare it to my own. I find myself watching your tweets and wanting to more about how you allocate your time.

Love this man, great thoughts. Thanks for sharing.It’s definitely important for the main focus of networking to be for feedback in an early phase of development. So many gains of insight and development can come from an outside perspective and even more importantly multi-disciplinary perspectives.It seems to be a bit of a chicken or the egg type conversation and I think it’s simple enough that it just needs to be integrated. Both need to exist to do well. Just exist… diff start-ups have hit well having more weight on either end, but both existed.

Thanks chris! Good stuff.Don’t agree with the lawyer one though.There are so many companies that do this and never get more than 1000 (unpaid) users through the door – total waste.You shouldn’t do non-core focused things until you have to. C crop and vesting docs aren’t important until you’re actually going to close on some money (not just talking to investors)

As far as programming, I would strongly advise new companies to only work with experts (or outsource to a US Based Company). This is not a good area to try to cut corners. Low cost developers and offshoring usually end up costing clients more money (and certainly more time), than just hiring right the first time. I own a small custom software company and many times we are brought in to fix programming problems caused by using poorly qualified developers. Brett Millerhttp://www.customsoftwarebypreston.com

great post, thanks.i really like (and should learn from) the concept of minimum viable blogging. i also do agree with kyle on non-tech people learning enough to understand a) what is possible; and b) how long things take (aka what is a hard problem and what is a simpler problem); and c) potentially communicating through prototypes.

As Chris notes, getting yourself and your startup out there through blogging/events/tweeting tends to provide a lot of benefits that might not appear at first, but pay off in the long run. Of course building a great product is the top mission, but so often in business the relationships you build are extremely important and can open a lot of doors to customers, partnerships, press, and investment. Yes, you can overkill on this as well if you’re spending too much time trying to be a celebrity and not building a product that’s going to be good, so try and find the right balance. It also works well if you’ve got multiple cofounders where one can take on some of this initial marketing if other cofounder(s) are more heads down on product development.

For points #3 and #6 StartupDigest helps you cut through the noise and find the high value events that matter in your city. It’s completely for free, all you need to do is sign up and we’ll send you these type of events 1x a week via email.I co-founded the company to help founders and entrepreneurs do exactly these 2 steps. We are lowering the barrier of finding your community whether you are a serial entrepreneur or just getting started.

Great post. As Aniq has pointed out about the tech co-founder thing, guess finding the right co-founder should be included as an important point – be it tech or business. As for reading blogs etc, guess if you follow startup inclined guys on twitter etc, you get to read filtered version of the articles that are good. 2 cent as per gyan for the aspiring & early stage founders/co-founders :).

One thing to add for consumer web startups:Hire a virtual admin on Elance and have him/her be in charge of scheduling informal usability / paper prototyping sessions via Craigslist. Set up a process where you can email you admin something like “I want to meet someone [within X demographic] at this Starbucks tomorrow at 8:30am.”These are two great resources for informal prototyping:http://www.amazon.com/Rocket-Surgery-Made-Easy-Yourself/dp/0321657292http://www.amazon.com/Paper-Prototyping-Interfaces-Interactive-Technologies/d…- You do usability so you can refine your idea before you build it- You meet with strangers because they are less biased. You’re friends will be biased for or against.- You use an admin because scheduling is tedious and posting to craigslist is really painful. Otherwise, you’ll give up and roll the dice.

All good comments, but agree that reading all the blogs and doing all the networking can be a time sink with a gambling style return profile – you might hit it big, but more likely you will end up jawing with another hopeful entrepreneur while your competitors are launching…

You can’t know what your first business will entail until you try it.And: blogging can be a huge waste of time. Maybe for internet start-ups it’s more important. But blogging doesn’t get you customers. Ditto for events.Re: law. Why not just use YCombinator’s free docs?Re: READING blogs. Come on, that is a huge waste of time.

I disagree regarding “read all tech blogs everyday”. This is way too much noise. I like blog reading (here I am!) and events, but to make a great product requires focus that all this chatter will interfere with. How many articles on TC are relevant to your business? You’ll probably see them via Twitter/FB etc. if you’re linked to people in the industry, and save yourself a tonne of other mediocre ‘new funding!’ journalism.

Thanks for the the list, Chris, and to the people who added helpful comments. I’m trying to quickly learn this web startup stuff on the job, and support 2 small kids and my wife. Helpful stuff!cheers!AaronSolo Founder of http://refynr.com

I 100% agree with the attorney comment. The last place you want to be is negotiating vesting and corporate setup if your startup takes off. Do things right to start with because you KNOW your idea will take off. Networking for networkings sake is not helpful. Network with those who you aspire to be like or with those who you may need to hire eventually. You have to step out of your peer group if you want to rise above them.Don’t stop evangelising your company and take a scientific process to the way you pitch to refine your statements to the points that resonate with your target demo.Have Fun. You loved something enough to launch a startup around it, never lose touch with that as it makes your company real.Georgehttp://twitter.com/georgelbowen